The story of agricultural policy in Northeast Asia over the past 50 years illustrates the dramatic changes that can occur in distortions to agricultural incentives faced by producers and consumers at different stages of economic development.
... See More + In this study of Japan, the Republic of Korea (the southern part of the peninsula, hereafter referred to as Korea) and the island of Taiwan, China (hereafter referred to as Taiwan), the authors estimate the degree of distortions for key agricultural products as well as for the agricultural sector as a whole over a period when these economies transitioned from low- or middle- to high-income status the beginning of the so-called East Asian economic miracle of dramatic industrial development. The three economies in terms of the nature of their economies, including their resource endowments that determined the course of their modern economic growth and development. The evolution of agricultural policies in the three economies is then reviewed before discussing how to measure distortions to agricultural incentives using the methodology from Anderson et al. (2008), the focus of which is on nominal and relative rates of assistance. Implications of empirical findings for policy reforms in the three economies are discussed in the final section, where the authors also identify lessons for later-developing economies experiencing similar structural transformations in the course of their economic growth. Statistical observations are found to be consistent with the hypothesis that the success of rapid industrialization that advanced these economies to the middle-income stage resulted in declines in agriculture's comparative advantage associated with the growing income disparity between farmers and employees in non-agricultural sectors.
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The story of agricultural policy in Northeast Asia over the past 50 years illustrates the dramatic changes that can occur in distortions to agricultural incentives faced by producers and consumers at different stages of economic development.
... See More + In this study of Japan, the Republic of Korea (the southern part of the peninsula, hereafter referred to as Korea) and the island of Taiwan, China (hereafter referred to as Taiwan), the authors estimate the degree of distortions for key agricultural products as well as for the agricultural sector as a whole over a period when these economies transitioned from low- or middle- to high-income status the beginning of the so-called East Asian economic miracle of dramatic industrial development. The three economies in terms of the nature of their economies, including their resource endowments that determined the course of their modern economic growth and development. The evolution of agricultural policies in the three economies is then reviewed before discussing how to measure distortions to agricultural incentives using the methodology from Anderson et al. (2008), the focus of which is on nominal and relative rates of assistance. Implications of empirical findings for policy reforms in the three economies are discussed in the final section, where the authors also identify lessons for later-developing economies experiencing similar structural transformations in the course of their economic growth. Statistical observations are found to be consistent with the hypothesis that the success of rapid industrialization that advanced these economies to the middle-income stage resulted in declines in agriculture's comparative advantage associated with the growing income disparity between farmers and employees in non-agricultural sectors.
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The story of agricultural policies over the past 50 years in the Republic of Korea (the southern part of the peninsula, hereafter referred to as Korea) and the island of Taiwan, China (hereafter referred to as Taiwan) is indicative of the dramatic changes in distortions to agricultural incentives that producers and consumers face at different stages of economic development.
... See More + In this study the author estimate the degree of distortions for key agricultural products, as well as for the agricultural sector as a whole over a period when these economies transitioned from low- to high-income economies (1955 to 2004). In the following sections, first the paper briefly characterizes the structure of agriculture in Korea and Taiwan in the course of their economic development. Next, the evolution of their agricultural policies is reviewed. Distortions to agricultural incentives in Korea and Taiwan are measured in terms of the nominal and relative rates of assistance to agriculture (NRAs and RRAs, respectively). Subsequently, the report discuss the policy implications of the estimates in the two economies and draw lessons for less-developed economies that are currently experiencing structural transformation in the course of their economic growth.
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The story of agricultural policies over the past 50 years in the Republic of Korea (the southern part of the peninsula, hereafter referred to as Korea) and the island of Taiwan, China (hereafter referred to as Taiwan) is indicative of the dramatic changes in distortions to agricultural incentives that producers and consumers face at different stages of economic development.
... See More + In this study the author estimate the degree of distortions for key agricultural products, as well as for the agricultural sector as a whole over a period when these economies transitioned from low- to high-income economies (1955 to 2004). In the following sections, first the paper briefly characterizes the structure of agriculture in Korea and Taiwan in the course of their economic development. Next, the evolution of their agricultural policies is reviewed. Distortions to agricultural incentives in Korea and Taiwan are measured in terms of the nominal and relative rates of assistance to agriculture (NRAs and RRAs, respectively). Subsequently, the report discuss the policy implications of the estimates in the two economies and draw lessons for less-developed economies that are currently experiencing structural transformation in the course of their economic growth.
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Policies to tax farmers in low-income countries and policies to subsidize them in high-income countries have been identified as a major source of the disequilibrium of world agriculture.
... See More + Recently, as many high-performing economies in Asia advanced from the low-income to the middle-income stage through successful industrialization, they are confronted with the problem of a widening income gap between farm and non-farm workers corresponding to rapid shifts in comparative advantage from agriculture to manufacturing. In order to prevent this disparity from culminating in serious social and political instability, policies have been reoriented toward supporting the income of farmers. At the same time, governments in middle-income countries must continue to secure low-cost food to the urban poor who are still large in number. The need to achieve the two conflicting goals under the still weak fiscal capacity of governments tends to make agricultural policies in the middle-income stage tinkering and ineffective. Greater research inputs in this area are called for in order to prevent the growth momentum of high-performing economies in Asia from being disrupted by political crises, as illustrated by the bent of Japan toward militarism during the period between the two World Wars.
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The story of agricultural policies over the past 50 years in the Republic of Korea (the southern part of the peninsula, hereafter referred to as Korea) and the island of Taiwan, China (hereafter referred to as Taiwan) is indicative of the dramatic changes in distortions to agricultural incentives that producers and consumers face at different stages of economic development.
... See More + In this study the author estimate the degree of distortions for key agricultural products, as well as for the agricultural sector as a whole over a period when these economies transitioned from low- to high-income economies (1955 to 2004). In the following sections, first the paper briefly characterizes the structure of agriculture in Korea and Taiwan in the course of their economic development. Next, the evolution of their agricultural policies is reviewed. Distortions to agricultural incentives in Korea and Taiwan are measured in terms of the nominal and relative rates of assistance to agriculture (NRAs and RRAs, respectively). Subsequently, the report discuss the policy implications of the estimates in the two economies and draw lessons for less-developed economies that are currently experiencing structural transformation in the course of their economic growth.
See Less -

Policies to tax farmers in low-income countries and policies to subsidize them in high-income countries have been identified as a major source of the disequilibrium of world agriculture.
... See More + Recently, as many high-performing economies in Asia advanced from the low-income to the middle-income stage through successful industrialization, they have been confronted with the problem of a widening income gap between farm and non-farm workers corresponding to rapid shifts in comparative advantage from agriculture to manufacturing. In order to prevent this disparity from culminating in serious social and political instability, policies have been reoriented toward supporting the income of farmers. At the same time, governments in middle-income countries must continue to secure low-cost food for the urban poor who are still large in number. The need to achieve the two conflicting goals under the still weak fiscal capacity of governments tends to make agricultural policies in the middle-income stage tinkering and ineffective. Greater research inputs in this area are called for in order to prevent the growth momentum of high-performing economies in Asia from being disrupted by political crises.
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East Asian Visions: Perspectives on Economic Development is a collection of essays by 17 eminent East Asians who represent a broad spectrum of backgrounds and experiences.
... See More + All are senior policy makers, statesmen, or scholars who have either had to deal with or think through some of the most critical financial and developmental issues confronting their countries and the region. Collectively, 10 of them have, at some point in their careers, been at the head of key ministries and central banks; nearly a dozen have been academics and scholars of distinction; several have served as ambassadors to the West and bring a more global strategic perspective; and many have been influential policy advisers and decision makers in governments and international financial agencies. Their essays reflect individual experiences at critical economic junctures and are occasionally quite personal, not surprising since each author selected a topic of his or her own choosing. Given their backgrounds, they have chosen to write about the highly diverse country experiences of East Asia, covering rich, middle income, and poor countries, and they speculate on how their countries fit into a rapidly changing region and globalizing world. Four themes permeate these essays: explaining East Asia's growth and developmental success; the powerful forces of regional integration and building efficiency versus vulnerability; avoiding domestic disintegration given growing public intolerance of increasing inequities, pollution, and corruption; and where will East Asia find its next generation of leaders.
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Counting the world's poor: problems and possible solutions; by Angus Deaton. Comments on "counting the world's poor"; by Martin Ravallion, and T.
... See More + N. Srinivasan. Ecology, history, and development : a perspective from rural Southeast Asia; by Yujiro Hayami. Productivity growth and sustainability in post-green revolution agriculture: the case of the Indian and Pakistan Punjab; by Rinku Murgai, Mubarik Ali, and Derek Byerlee. The politics of Russian enterprise reform: insiders, local governments, and the obstacles to restructuring; by Raj M. Desai and Itzhak Goldberg.
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The process by which different ecological conditions and historical trajectories interacted to create different social and cultural systems resulted in major differences in economic development performance within Southeast Asia.
... See More + In the late 19th century, Indonesia, the Philippines, and Thailand commonly experienced vent-for-surplus development through exploitation of unused lands. Nevertheless, different agrarian structures were created. Indonesias development was mainly based on the exploitation of tropical rain forest under Dutch colonialism. It resulted in the bifurcation of the rural sector between rice-farming peasant proprietors and large plantations for tropical export crops based on hired labor. In the Philippines, exploitation of the same resource base under Spanish rule resulted in pervasive landlessness among the rural population. Relatively homogeneous landowning peasants continued to dominate in Thailand, where delta plains that were suitable only for rice production formed the resource base for development. These different agrarian structures associated with different social value systems have accounted for differential development performance across the three economies in the recent three decades.
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According to Mint's "vent for surplus" theory, development of the economies of Indonesia, the Philippines, and Thailand from the nineteenth century on depended on the natural advantage of large tracts of unused "empty land" with low population density and abundant natural resources of the type typically found in Southeast Asia and Africa at the outset of Western colonization.
... See More + When these economies were integrated into international trade, hitherto unused natural resources (primary commodities the indigenous people had not valued) became the source of economic development, commanding market value because of high import demand in Western economies. The major delta of Chao Phraya River was the resource base of vent-for-surplus development with rice in Thailand; tropical rain forests filled that role in Indonesia and the Philippines with respect to the production of tropical cash crops. This basic difference underlay differences in the distribution of farm size: the unimodal distribution of peasants or family farms in Thailand and the coexistence of peasants and large estate farms or plantations specializing in tropical export crops in Indonesia and the Philippines. Differences in agrarian development were also shaped by different policies toward the elite's preemption of unused land. Under Spanish colonialism, the elite preempted unused land in the Philippines wholesale, bifurcating land distribution between non-cultivating landlords and sharecroppers in lowland rice areas, and between plantation owners and wage laborers in upland areas. In Indonesia, the Dutch government granted long-term leases for uncultivated public land to foreign planters, but prevented alienation of cultivated land from native peasants, to avoid social instability. In Thailand, concessions were granted for private canal building, but the independent kingdom preserved the tradition of giving land to anyone who could open and cultivate it. Relatively homogenous land-owning peasants dominated Thailand's rural sector. As frontiers for new cultivation closed, the plantation system's initial advantage (large-scale development of land and infrastructure) began to be outweighed by its need to monitor hired labor. The peasant system, based on family labor needing no supervision, allowed Thailand's share of the world market in tropical cash crops to grow, as Indonesia and the Philippines lost their traditional comparative advantage. Moreover, land reform in the Philippines made land markets inactive, with resulting distortions in resource allocation and serious under-investment in agriculture.
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